London landlords ‘could see greater rental yields’

Buy-to-let investors should continue to see demand for rental property across the UK, a source suggests.

According to NuWire Investor, the region's attraction to immigrants means the number of people looking to rent accommodation will remain strong.

Despite public anxiety over the rising level of immigration, forcing the government to become more restrictive, many foreign workers are still expected to flock to Britain.

In particular, landlords in London could see a considerable rise in income as the capital begins to reap the benefits of hosting the Olympics in 2012.

As well as increasing the number of workers required for construction projects, the event is likely to see demand for foreign employees in hotels, restaurants and tourism accelerate.

Temporary workers and new immigrants are therefore expected to continue to push up rents, meaning landlords can expect improved rental yields over the next few quarters, the report claims.

House prices in the capital have seen a considerable fall this year, according to the Chesterton CEBR House Price Poll of Polls, with average values now £38,700 lower than at their peak earlier in 2008.